Oklahoma City, Oklahoma News

The five Oklahoma companies are CSI, Oklahoma City, ranked fourth; DeatschWerks, Oklahoma City, 31st; Funnel Design Group, Oklahoma City, 54th; AmericanChecked, 70th; and Sperry Van Ness/William T. Strange & Associates, 93rd.

The rankings for each company were announced at the Inner City 100 Awards on Wednesday in Boston.

Roy Williams, President and CEO, said Krieger's contributions to the region are numerous. "Robin has shown tremendous leadership in the development of our cluster industries, particularly Aerospace and Bioscience. She was instrumental in working with the County and the Air Force on the transition of the GM facility to military uses. Her work was vital to the creation of the Oklahoma Bioscience Association and the effort to grow this industry. She also played a pivotal role in the Boeing expansions, the recruitment of AAA and others."

Carl Edwards, Chamber Chairman and Partner of Price Edwards also recognized her efforts. "Oklahoma City is poised to see more success in our economic development efforts and that is in part due to Robin's work. Her leadership has been invaluable. She led the campaign and the work programs for Forward Oklahoma City III and IV, which has put our organization and community in position to continue this success. Her leadership within the industry as former Chair of the International Economic Development Council elevated both her stature and that of this position in Oklahoma City. I am confident that with our economic development team and Roy's leadership, this will be a smooth transition."

Williams said that the Chamber is conducting a national search for Krieger's replacement.

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Oklahoma employers expect to hire at a pace that would be among the tops in the nation over the next three months, according to the quarterly Manpower Employment Outlook Survey released Tuesday.

Nearly one in four (24 percent) Oklahoma employers surveyed said they plan to hire more employees from April to June, while just 4 percent of respondents expect to reduce staff, Manpower-Group said. Two of three employers surveyed said they plan to maintain current levels, while 5 percent said they don't know.

Among survey participants, the Oklahoma employment outlook is the fourth best in the nation, the hiring firm said.

The Oklahoma City area employment outlook, which was very similar to the statewide result, was the third-highest in the nation among the metropolitan areas surveyed, ManpowerGroup said.

Subtracting the percentage of employers who expected to cut staffing from those that planned to hire resulted in a "net employment outlook" of plus-20 percent.

Manpower spokeswoman Sunny Ackerman said the hiring outlook for Oklahoma employers was double that of a quarter ago, and significantly stronger than at the same time last year.

"Compared to one year ago when the net employment outlook was plus-15 percent, employers are more optimistic about their staffing plans," Ackerman said.

Manpower spokesman Rob Denton said Oklahoma City employers "expect much stronger employment prospects" when compared to the 9 percent outlook of a year ago.

Compared to the previous quarter, "the employment forecast for the second quarter is considerably brighter," Denton said.

Tulsa's hiring expectations for the second quarter were similar to those of Oklahoma City and the state, according to the survey. Among Tulsa employers, 24 percent said they planned to boost staffing levels in the next three months, while 4 percent said they expected to reduce the number of employees.

Nationally, hiring optimism is gaining momentum as positive outlooks were reported broadly across all industries and geographies, the survey showed. The second-quarter outlook was plus-10 percent nationally, the most optimistic national hiring sentiment since the end of 2008.

Jonas Prising, Manpower-Group president of the Americas, said employers are reporting increased demands for products and services, which translates to more jobs.

"Although we are not out of the woods yet, our data shows that this hiring progression is increasingly solid " Prising said.

The Manpower Employment Outlook Survey is based on interviews with 18,000 employers in all 50 states, the District of Columbia and Puerto Rico, and includes the largest 100 metropolitan statistical areas based on number of business establishments.

We've been focusing for the past several columns on angel investing in Oklahoma. Angel investors are wealthy people who supply much-needed seed and early-stage capital to startup companies.

To recognize why angel investing is so important, it helps to spend a little time looking at the evolving realities of the venture capital world ? formerly the primary source of capital for startup companies.

It used to be that venture capital firms were the go-to source of seed and early stage capital. However, since the dot-com bubble, the number of venture capital firms and funds, and dollars under their management has been trending down significantly.

In 2000, 649 venture capital funds reported raising money and there were more than 100 new funds. In 2010, 157 funds reported raising money and there were only 44 first time funds.

Venture capital investments have always been concentrated. Nearly 80 percent of the 3,294 such investments for 2011 were in 10 states (on the Coasts, plus Texas, Pennsylvania, and Illinois) that garnered 85 percent of venture capital money invested.

The remaining 701 investments were spread across the remaining 40 states.

The National Venture Capital Association reports that while both deals and dollars were up from 2009 to 2010, resizing the industry at about $20 billion off its $30 billion highs, initial public offering and acquisition activity were far below what is necessary to sustain the venture capital industry long term.

Data from the New Hampshire Center for Venture Research and from the venture capital association shows that angels invest in more than 97 percent of startup and early stage deals.

Venture capitalists invested in 2 to 3 percent. Given the challenges the industry faces, this isn't likely to change.

However, when one door closes, another door opens.

Increasingly, angel investors have organized into groups to leverage their money, expertise and resources to syndicate increasingly larger seed and early-stage deals.

More than one-third of the Angel Capital Association's reported deals are syndicated, and more than a third of all reported deals are more than $1 million.

In Oklahoma, the three chapters of the SeedStep Angels group have provided syndicated deal flow, invested in a halfdozen companies and active membership programs under way, all of which is critical to the state's entrepreneurial ecosystem.

Oklahoma may continue to be one of the 40 states with limited venture capital, but with SeedStep Angels, we are solving the problem of access to capital ourselves.

Tom Walker is president and CEO of i2E, Inc., a nonprofit corporation that mentors many of the state's technology-based startup companies. i2E receives state appropriations from the Oklahoma Center for the Advancement of Science and Technology. Contact him at i2E_Comments@i2E.org.

Even though much retail focus in the Oklahoma City metro has been placed on the Memorial Road area and in Edmond, the real retail powerhouse is not north, but much farther south.

Over the past decade, the real standout submarket in the local retail area has been in the city of Norman. Vacancy has largely remained below 5 percent throughout that time. Prior to the national recession, vacancy dipped as low as 2 percent for a couple of years ? a vacancy rate that is almost unheard of in any market, especially in the Oklahoma City area. Even during the recession, vacancy remained at 5 percent, as the increases in vacancy were not as prominent as what was experienced in other local submarkets.

This low vacancy is really not surprising. Several factors drive the strength of the Norman market. Obviously, it has become a regional shopping destination with a customer base that stretches as far south as Ardmore. Its demographics are also bolstered by the University of Oklahoma and continue to be some of the strongest in the metro area. It is no secret that college students spend a sizable amount of retail and restaurant dollars.

The strength of the Norman market has been most appealing to restaurants. National and regional chains that have entered the metro area in recent years selected Norman for their first Oklahoma restaurants. Prime examples include Saltgrass Steak House and Chuy?s, which recently announced its expansion into the area from Austin, Texas.

The southern portion of the metro area is clearly becoming a retail powerhouse when considering the amazing growth in Moore over the past decade. The emergence of the Moore Towne Center and Warren Theatres around the intersection of 19th and Interstate 35 has created a shoppers destination area that rivals the Memorial Road corridor.

Many local firms are now tracking Moore and Norman as one submarket as the two retail markets grow into each other along Interstate 35 and are enjoying a tremendous amount of synergy. In its year-end report, Price Edwards & Co. described this submarket as excelling and forecasted continued growth due to limited availability, which will cause rents to rise.

Darren Currin is an independent research analyst and consultant who specializes in Oklahoma City and Tulsa commercial real estate. He may be reached at (405) 476-0164 or dcurrin@cox.net.

VentureSpur, a firm designed by three entrepreneurs who returned to their roots to nurture early-stage companies seeking to mature and attract capital, launched Wednesday in downtown Oklahoma City.

The venture accelerator company follows a model of firms in other parts of the country that have successfully helped develop fledgling firms that have a business plan and perhaps a prototype, but haven't yet earned their first round of venture capital, VentureSpur co-founder and managing director Kraettli L. Epperson said.

?Getting to the point that the business is ready for venture capital is a big leap for many companies,? Epperson said. ?Many promising companies that might produce a great business in a city or region don't get to that point.?

VentureSpur plans to host two groups of three startup companies each year, offering free office space, mentoring from successful Oklahoma entrepreneurs, development and education opportunities and money from a seed fund. Founders of developing companies typically swap equity in their business for early-stage funding.

The company, based in The Exchange building on Film Row, is accepting applications from startup businesses. VentureSpur will winnow down those applicants to two or three companies, which will be selected by late summer to participate in a three-month ?boot camp,? Epperson said.

While previous successful venture accelerator firms have focused on software companies, Epperson said VentureSpur won't be limited to that niche.

?We're looking for companies that have large market potential, that are going to be scalable so they are attractive for additional follow-on investment,? he said. ?These are companies that are further along than an idea on the back of a napkin.?

Epperson, owner of the Oklahoma City information technology consulting firm Black Mesa Consulting, co-founded VentureSpur with David Matthews and Gabe Bass. Matthews is a partner in the venture capital firm, Trailblazer Capital, and manager of the Oklahoma Opportunity Fund. Bass is managing partner of Bass Law, with offices in Oklahoma City and El Reno.

Matthews said VentureSpur's accelerator model ?provides big advantages in emerging venture capital markets like Oklahoma, where the cost of doing business is low and local investors are hungry for homegrown success stories.?

Epperson said the firm hopes and expects to attract some of the area's ?best and brightest? entrepreneurs.

?There is a lot of pent-up demand among investors in Oklahoma for the kind of central hub and critical mass we believe an accelerator can bring to state,? Epperson said.

The state?s Quality Jobs Program is close to topping last year?s figures, and the program is just halfway through the 2012 fiscal year.

In December, the Oklahoma Department of Commerce accepted more Quality Jobs participants than in any month since the program was launched in 1993, said spokesman Dustin Pyeatt.

?Two reasons for those figures,? Pyeatt said. ?The Commerce Department promotes the incentives and makes it a point to alert companies about the incentives. We hold workshops in Oklahoma City and Tulsa and walk these representatives through the process.?

Secondly, state business recruiters and economic development teams travel outside the state, talking up the incentives with company CEOs, he said.

Manufacturing continues to lead the way in the number of companies and jobs entering the incentive program, Pyeatt said.

?Manufacturing is the central focus of the program,? Pyeatt said. ?Manufacturing accounted for more than half of the jobs created through the incentive program because many companies base their research and development operations in a central location.?

Companies must earn the incentives, Oklahoma Secretary of Commerce Dave Lopez said in a statement, and the program is performance-based.

?If a company doesn?t create any jobs, there are no incentive payments,? Pyeatt said. ?If a company closes or moves outside Oklahoma, we stop incentive payments.?

No state money goes outside Oklahoma, Pyeatt said.

And the state Commerce Department expects results from Gov. Mary Fallin?s survey of state executives, Pyeatt said. The state received more than 5,300 surveys from business executives, he added.

?No state has ever done this before,? Pyeatt said. ?This will be a powerful tool during the next session on how to craft incentive programs and drive legislation.?

The survey results will be released in conjunction with the opening of the legislative session in February, he said. The survey was designed to track economic issues the state can improve on and identify ways to support companies with economic development.

?We will see how Oklahoma is doing and where the state needs to go next,? Pyeatt said. ?The survey results will be like a road map for state leaders.?

Since its inception, the Quality Jobs Program has issued more than 612 contracts to companies locating and expanding in the state, Pyeatt said in a statement. Startup businesses have brought thousands of jobs to Oklahoma, he said.

In the first six months of this fiscal year, which began on July 1, 26 companies enrolled, Pyeatt said, just eight short of the 34 that enrolled in all of 2011.

The average projected wage of jobs created through the QJP this year tops the state?s average job wage of $38,882 by 77 percent, Pyeatt said in a statement. The average so far in FY 2012 is $68,805.

Much of the gain in average wages is due to Boeing, Pyeatt said.

Boeing, which this month said it would move 800 jobs from Wichita and 100 jobs from the Seattle area to Oklahoma City, has already applied for benefits from the QJP for 462 jobs in FY 2011, Pyeatt said.

?Boeing has been a factor this year,? Pyeatt said. ?First we accepted 207 jobs into the program, then another 255.?

During the first half of FY 2012, 85 percent of companies in the QJP were existing businesses that expanded in Oklahoma, according to a release. That amount topped the number of expanding businesses last year by 9 percent.

Startup companies entering the program through the first half of the fiscal year made up the other 15 percent, according to the release.

OKLAHOMA CITY ? Passenger traffic through Will Rogers World Airport for 2011 was up almost 3 percent over the previous year, Oklahoma City airport officials reported Thursday.

But traffic through Tulsa International Airport for the year was down nearly 2 percent compared with 2010. Tulsa?s airport experienced a total decline of 52,000 passengers boarding and leaving planes for the calendar year, while Oklahoma City?s airport saw a total of 105,000 more passengers coming and going, officials reported.

The year ended on a high note for Will Rogers, with more than 13,000 passengers leaving the city during traditionally the heaviest travel months of November and December, up about 5 percent from the same months in 2010. Airport officials said earlier that mild weather probably helped buoy those figures. As is usually the case each year, fewer passengers disembarked in the city compared with those going to visit elsewhere.

In Oklahoma City, Southwest Airlines reported the greatest number of passengers boarding planes, nearly 57,000 over the entire year. Southwest showed 4-percent growth for the year over 2010. Delta and United airlines were next, with about 25,000 and 19,000 passengers, respectively. United, however, showed the greatest passenger growth in Oklahoma, 30 percent over 2010 traffic. At the other end of the scale, Continental numbers declined by 37 percent for the year.

"Existing studies aren't giving us an accurate snapshot of Oklahoma's aerospace industry, because they focus only on private sector employment and manufacturing," said Eric Long, research economist for the Greater Oklahoma City Chamber. "This means the role of Tinker Air Force Base and FAA's Mike Monroney Aeronautical Center are often understated. This new study includes federal workers and gives us a much more accurate picture of the size and impact Oklahoma City's aerospace industry has on the region's economy."

Part one of the study evaluated the economic impact of the industry. Results indicate that 307 public and private sector employers were directly engaged in aerospace and aviation activities in the Greater Oklahoma City region in 2009 and early 2010. These companies produced approximately $4.3 billion in goods and services and employed nearly 38,000 workers earning $2.36 billion in income. Tinker Air Force Base and the FAA's Mike Monroney Aeronautical Center form the foundation of the industry in the region, with more than 84 percent of total employment.

The estimated ripple effect from this aerospace and aviation activity supported an additional 47,748 workers statewide earning $1.3 billion in income and producing more than $3 billion in goods and services. In total, the sector either directly or indirectly supports the production of $7.3 billion in goods and services and more than 85,400 workers.

"This study shows us that each direct job in the aerospace sector supports approximately 1.25 additional jobs in the broader state economy," said Roy Williams, president and CEO of the Greater Oklahoma City Chamber. "That is phenomenal and will only continue to grow ? especially with companies like Boeing bringing even more high-quality jobs to our region."

Part two of the study looked at the size and composition of the industry. When viewed using databases that include federal workers, Oklahoma ranks among the top 10 states in terms of employment in most traditional aerospace occupations. Tinker AFB and FAA largely dominate the industry; however, the business mix at both facilities has a strong synergy with private sector aerospace activity. Tinker makes up 60 percent of the labor market for nearly 5,000 installation, maintenance and repair workers, with Tinker contractors and other private sector firms who perform maintenance work for the commercial and general aviation industry employing the remainder.

Federal procurement contracting remains an important component of the aerospace industry in Oklahoma. Within the 10-county region, 25 vendors completed approximately 98 percent ($512.6 million) of the $521 million aerospace related procurement work.

The study concludes that all of the assets are in place to elevate Oklahoma's standing in the aerospace community in the coming years, and that procurement success will likely expand significantly. This survey comes on the heels of the Oklahoma Department of Commerce's economic impact report of Oklahoma's Five Military Installations. That report looked at the entire state and all military work, not specifically aerospace. The full results of that study can be found here.

To review the executive summary of this report, please visit www.greateroklahomacity.com/aerospace. For more information, please contact Kaylee McDaniel at kmcdaniel@okcchamber.com or 405-297-8971.

OKLAHOMA CITY ? Boeing Co.'s announcement to bring up to 900 jobs here from Wichita, Kan., and Seattle adds to the critical mass in the aerospace sector that the city is experiencing, various industry observers and experts said.

Boeing said on Wednesday that it would close its Wichita plant in two years and move 800 engineering and project management jobs to Oklahoma City. In addition, Boeing said it was moving another 100 jobs from the Pacific Northwest to Oklahoma City.

"I think if this comes to fruition, it would be very big for Oklahoma City," said Jeff Davis, a partner of Oklahoma City-based Acorn Growth Cos. "It would be another example of an aerospace and defense firm moving jobs here."

The announcement for Boeing is the second major move for the aerospace giant, as the company is committed to moving 550 jobs from Long Beach, Calif., Davis said.

"This announcement is evidence of the strides that Oklahoma City has made in recent years in how we are able to capitalize on the strength of the aerospace sector in Oklahoma City," he said.

Roy Williams, president and CEO of the Greater Oklahoma City Chamber, said the move is significant because of the economic impact the direct payroll would have on the city.

"These aviation and aerospace jobs are in engineering," Williams said. "These are well-paying positions."

Salaries for the Long Beach jobs pay in the neighborhood of $120,000 to $130,000 annually, Williams said.

If, for example, the latest jobs paid in the range of $100,000 annually, the payroll could be as much as $75 million in direct payroll, Williams said.

"But we just don't know," he said. "They have not given us salary ranges yet. We could be seeing those figures in a few weeks."

The addition of 900 jobs would push Boeing's total employment in Oklahoma City to 2,000, Williams said.

"And the indirect economic impact of Boeing is significant as vendors and suppliers seek business here," Williams said.

The move will have an effect on Wichita and Oklahoma City, said Greg Womack, president of Edmond-based Womack Investment Advisors.

"It is bad news for Wichita, but Oklahoma City should benefit from their loss," Womack said. "It's unfortunate how the effects of our economy and budget issues are affecting many manufacturers, especially government suppliers."

There could be more downsizing from government contractors as they seek to be more efficient in the wake of the austerity trend, Womack said.

Davis, who heads Acorn's aerospace and defense operations and investor development activities, said the announcement strengthens Oklahoma City's stance as an aerospace leader.

Acorn's portfolio includes a variety of aerospace and defense companies in 11 states.

"Some of us think Oklahoma City is among the (aerospace) leaders ? certainly on the military side," Davis said.

Davis referred to Tinker Air Force Base's role as a leader in military aviation. The base employs more than 26,000 people with an annual payroll of $1 billion.

Williams agreed that Oklahoma City has reached a critical mass in aerospace.

"Tinker is positioned as the place where major decisions are to be made," he said. "Couple that with the Boeing move and we see other suppliers realigning here as well. The best-case scenario would be seeing companies, both competitors of Boeing and Boeing suppliers, showing some interest here."

Williams said he expects the momentum to grow for Oklahoma City's economy.

"You can begin to see a lot of synergy," he said. "Other things begin to align and all of sudden a lot of things begin to happen. This is significant enough of an announcement that I believe we could be seeing that beginning to happen."

Williams cautioned that the economic effect will be not be seen overnight.

Only 200 of the 550 positions from Long Beach have been transferred to Oklahoma City. Boeing said it would be a year to 18 months before the Wichita jobs would be transferred and two years before the plant is shuttered.

"People need to understand things like this take a while," Williams said. "Eight-hundred jobs are not going to show in one day."

Boeing has been in Wichita for 80 years and since World War II has been one of the city's largest employers. But cuts in the U.S. Defense Department budget pressured the aircraft manufacturer to close the plant, costing 2,150 employees their jobs.

The Wichita plant specializes in modifying commercial aircraft for military or government operations.

Even with the loss of the defense plant, Boeing continues to have an economic impact in Wichita as Spirit AeroSystems builds parts for Boeing's commercial airplanes.

Spirit AeroSystems, which took over Boeing's commercial operations, operates plants in Tulsa and McAlester.